St. Paul daily globe. [volume] (Saint Paul, Minn.) 1884-1896, 1887-05-01

previous to the passage of the National
Bank act, and especially during the
period of general business depression
succeeding the great financial crash of
1857, its losses from that source were not
great as compared to many, and per-
haps most other new Western cities.
But from the beginning of the new era
inaugurated in the history of banking
in this country by the passage. of the
National Bank act, with the additional
safeguards for which it provided, the
banks of st. Paul, as regards their char
acter and management, and considered
as whole, have deservedly occupied
the very highest rank among similar
establishments located elsewhere in this
or other countries. With present
population of probably 10000, st. Paul
contains fourteen banks, whose united
capital and surplus aggregates at
this time SS,S45,Ge0. AS each stock
holder is legally liable for an addi-
tional amount equal to the par value of
the shares held by him, the actual respon-
Sibility of the banks available to credit
orS exceeds $4,000, 600.
Directly connected with the admins
tration of the affairs of these banks as
directors and officers are over 2eO per-
sons, a majority of whom are among the
most prominent and wealthieSt business
men in the Northwest, their united in
dividual means certainly amounting to
not less than $4,000, 0O0-and probably
considerably exceeding that sum. AL
though this private capital is, of course,
is no sense any portion of the assets of
the banks, yet, as may readily be seen,
it indirectly adds very materially to
their strength and effectiveness. This
article is not intended to be statistical,
but correct idea of the volume of bust
ness transacted by the st. Paul banks
and of the rapid growth of that bust
ness, especially during the last few
years, cannot be better conveyed than
by few figures taken from the records
of the clearing house and from the pub
lished reports of the banks themselves.
In 1860 the entire aggregate deposits of
all the banks did not exceed $500, COO
In 1867 they had reached about 81 900, COO
On the lst day OF March, 1887, or taking
the nearest published reports thereto,
they stood at S17,072, 7O5.32. The ST.
Paul clearing house went into operation
in 1874, the clearings for that year
amounting to $50, 947, $500, for 1885
they were s1ls,340, 977.91, and for 1885
S15S,6l5, 1850. For the current year
from Jan. to April 26, inclusive. they
amount.to an aggregate of $50, So, PAT. ~.
Should only the same average continue
for the remainder of the year it will
bring the total for 1887 up to S177,-
991, 1920, but as business is usually the
lightest during the winter and early
spring months, it seems reasonable to
expect that the actual total will reach
at least S190, 100000. The clearing house
exchanges, Of course, represent but a
portion of the daily transactions of the
banks, the ordinary average probably
being from about % to $50 per cent.
That is to say that if the clearings
amount to Sl90,000,0O0, the actual
volume of the business transacted
represented thereby will be not less
than three times that amount or S570,-
100000. The operations going to make
up this large mass of business are
numerous, and the proper performance
of the vast amount of detail work they
involve necessitates the services of
large number Of persons specially quail
fed for the discharge of the duties to
which they are assigned. The work
ing force" of the st. Paul banks, con-
SiSting Of the executive officers, tellerS,
bookkeeperS, clerks, etc. numbers 17S
men. One important matter connected
with the business of these banks has
not yet been referred t0-that OF dis
counts. To be profitable to its stock
holders and Of the greatest benefit to
the community in which it is located, a
bank must keep its available means as
actively employed as circumstances and
a due regard to safety will permit. In
addition to keeping safely and returning
promptly when required the funds de-
posted with it, one of a banks proper
and chief functions is to loan money
not required to meet its own obligations,
and as was illustrated in previous
paragraph, to act as distributing as
well as receiving reservoir. In max
ing such loans, however, care is neces-
sary that they are Of such character as
assures their payment at maturity, as
well as ultimate safety. 1t is for this
reason that the provision in the National
Bank act prohibiting banks organized
under it from making loans based on
real estate security is wise one, such
loans however safe in point Of final
security are usually for long time, and
even if Invested Of that objection, can
not be realized upon with sufficient
promptness to meet the necessary re-
quirements of a bank of deposit. The
banks Of st. Paul have very generally
confined their loans within the legiti-
mate limits of commercial and business
paper, and Of the 1889, 365.79, bills
discounted held by them at the date of
the last reports, it is probable that the
great proportion were of that character.
Such being practically the use made of
this large accumulation of capital, it
will readily be perceived that the st.
Paul banks are, to say the least, of no
inconsiderable assistance in developing
and sustaining the great commercial
and manufacturing interests of the city
where they are located, and of the region
of country which is in direct commercial
relations with it.
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